By Linda Nguyen, PhD MBA
photography by Kyle Carreon
Unemployment
My position at a biotech company was terminated in April, which was sad, but also gave way to a lot of different opportunities for me to explore what my next adventure could be. I’d already spent most of my life in school getting my PhD in cellular and molecular biology. I already got the dream job I wanted in NYC and negotiated huge billion dollar deals between academia, biotech and pharma companies. However, I had also been wanting to spend more time creating and writing, finding my voice and developing it further. So I started my own company, Life Sci PhD LLC, earlier this year, to start earning money and tracking my new ventures to do consulting work on biotech, pharma and lifestyle topics. Then I built out this website to share my experiences and what I’ve learned navigating my life in the personal life domains and professional science domains – hence Life Sci PhD. My hope is to be able to grow the site and build out my social media following in lifestyle and science (more to come later) to monetize it as well while looking for full time work. So this period of funemployment was a gift and the knowledge that the world was open to me to discover its joys buoyed my spirits.
In Part 1 of my funemployment learning series, I discussed what I learned about negotiating severance packages, COBRA and health insurance. In this article for Part 2, I’ll cover what I learned about personal finance to prepare myself financially in case of job loss (which eventually did happen). Later, I’ll write about what I’ve learned about social media and how I’ve entered the foray of teaching shuffle classes in New York City. I’m so happy you’re here to join me for the ride!
Finances
Personal finances are very important because, employed or not, you have to cover rent, utilities, bills, groceries, and other expenses. I’ve been using an app to track my income, expenses and budget since last year, which helped me understand my spending, investment, and savings habits. Taking responsibility for my finances in this way has made it easier to pay down debt and increase savings and investments. Here’s what I’ve been doing to manage my finances:
Checking: Last year, I consolidated my multiple checking accounts into one bank to simplify matters. Growing up in Boston, Bank of America was the prevalent bank, so I had accounts there for checking and savings. However, after moving to Manhattan, it was more convenient to have my money at Chase because of the numerous Chase banks in the area; I did not want to be trudging 13 minutes through the snow to the nearest Bank of America to withdraw cash in the winter yet again.
Savings: Part of my biweekly paycheck went to savings. Seeing many friends lose their jobs in the past year made me realize the importance of an emergency fund, so I aimed to save 3-6 months’ worth of expenses. When I received raises or bonuses, I divided the amount between savings and investments to avoid increasing my standard, and thus cost, of living. This was challenging in a city like New York with its many enticements for entertainment and good food, but I’ve been working on striking a balance to enjoy the city while saving.
Another helpful step was closing my savings accounts with Bank of America and Chase and opening a high-yield savings account at Marcus instead, which has a 4.4% annual percentage yield. This high yield helps overcome inflation, which has been 1.2%-8% in the last 5 years. Interest has been paid out into my savings account at the end of every month which is nice to see the uptick in value over time.
If you sign up for Marcus with my promotional link, you will also received a Marcus referred rate for 3 months, increasing your annual percentage yield to 5.4%. Thank you for your support!
Investments: I set aside a bit of money from each biweekly paycheck to be sent to my investment account so I could invest in an ETF like VOO or SPY in the S&P 500 Index. This diversifies risk by buying tiny fractions of companies in the S&P 500. The annual rate of return is typically assumed to be 8%, but it fluctuates depending on market conditions. At the time of writing, the S&P 500 had increased by 25.70% in the last year and 86.67% in the last 5 years. I also manually balance my portfolio with other investments in international funds, bonds, and gold to further mitigate risks. If you don’t invest your money to let it compound, grow, and reinvest dividends, you may be losing money by letting it sit in your bank account.
Retirement: I was privileged to work at a company that matched 401(k) retirement contributions up to a certain extent, so each month, I sent a percentage of my paycheck to be invested for retirement in my 401(k). In 2024, the maximum you can contribute to your 401(k) plan is $23,000 for employees. I also saved money monthly or from my year-end bonus to contribute to my Roth IRA (max contribution of $7,000 in 2024, depending on your income bracket). Now that I am no longer employed at the firm, I can consider the self-employed 401(k), depending on my income ($23,000 as an employee and up to $69,000 as an employer, depending on profits). However, I am not yet generating a profit, so I will explore the self-employed 401(k) option later when my company’s finances make more sense. I am also searching for work in my field to have a steady full-time income again with the benefits of an employer-matched 401(k) contribution.
To be continued…
As I finished writing about what I learned about finances, I realized this article was quite lengthy. Be sure to subscribe and follow me for more tips on navigating unemployment, how I prepared myself financially for it, how I’m building my business on social media, and what it’s been like teaching shuffle classes in NYC! Thanks for reading and for all of your support. It means the world to me. Let me know about your experience with funemployment in the comments below.
This article is meant to relay my learnings on personal finance and investing. What worked for me may not work for you. Please consult your financial advisor for investment advice for your situation. I may earn a small commission when you purchase through links found on this site. Thank you so much for your support!